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New protests to shake Germany

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BERLIN, Jan 2 (AFP) : Protesters were expected to hit the streets in more than 30 German cities Monday, two days after a sweeping reform of welfare payments aimed to cut long-term unemployment went into effect.

But unfazed by the protests, Economy Minister Wolfgang Clement told the weekly Bild am Sonntag he was confident "that the most comprehensive reform of the job market in the history of the Federal Republic of Germany will eventually be a success".

"I will be responsible for its success or failure," he added.

The controversial package of labour market reforms known as Hartz IV will have a wide-reaching impact on the lives of 4.5 million people out of work in what is still Europe's economic powerhouse.

It is impossible to tell for the moment exactly how many unemployed will lose money under the new system or who will benefit from the changes.

But those expected to feel the changes hardest are the long-term jobless and the 2.7 million people who the Federal Labour Agency says have used up their benefits and now receive only minimum welfare payments.

The Agency says less than 10 per cent will lose their welfare payments altogether, a figure the unions reject. They put the figure at 27 per cent and say 48 per cent will have their income reduced.

To calculate the new benefits, the Federal Labour Agency analyses peoples' estate, their expenditure and their needs, which is already sparking controversy.

The government argues that overhauling Germany's generous social welfare system, once the envy of the world, will persuade people who have been out of work for more than a year to accept a job, no matter how low paid.

But support groups for the unemployed have criticised a move they say will make the poor poorer.

Other observers have called for recognition that even after the reforms are introduced, the German welfare state will be relatively generous to the unemployed.

For example, the point at which the value of an unemployed person's residential property is taken into consideration is 200,000 euros (270,000 dollars) and only nine per cent of homes in western Germany and three percent in eastern Germany are valued higher.

Monday's expected protests come in the wake of demonstrations last year which were held for weeks Mondays, similar to rallies which brought down former East Germany's communist regime in 1989.

Anti-Hartz IV Monday protests eventually fizzled out but widespread unease with the reform translated into severe electoral blows for Chancellor Gerhard Schroeder's Social Democrat party.

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